PERFORMANCE

MANAGEMENT

FACTORS IMPACTING PERFORMANCE
f (ability + motivation + opportunity)

f (indi. attributes + wk effort + orgn support)

f (knowledge + motivation + feedback + leadership +
personality)

FROM PERFORMANCE APPRAISAL TO PERFORMANCE MANAGEMENT .

PA TO PM FROM System Appraisal Outputs Reward oriented Ratings common Top down Directive Monolithic Owned by HR TO Process Joint review Outputs/Inputs Development oriented Less rating 3600 feedback Supportive Flexible Owned by users .

Using the results for different organizational decisions Appraisal Interview Performance Planning & Goal setting Performance Management Process Performance Appraisal using a predetermined format Observation of performance & continual Feedback .

WHY? PURPOSE OF PM SYSTEM • Strategic: help top mgmt achieve strategic objective • Administrative: furnish valid information to make admin decisions about employees • Developmental: allow managers to coach employees • Informational: inform employees about their performance and expectations from them • Organisational maintenance: provide information to be used in HR planning and allocation • Documentational: collect information that can be used for different purposes .

WHEN? FREQUENCY OF APPRAISAL • Informal evaluation – Continuous • Formal evaluation – Annual or Biannual • Anniversary date approach • Focal point approach .

WHAT? CRITERIA USED Traits or characteristics Actual performance Training Needs Behaviour Potential .

WHO ARE THE APPRAISERS? • Superior(s) • Self • Peers / Team members • Subordinates • Customers – internal and external • Committee .

PERFORMANCE APPRAISAL METHODS Appraisal Methodologies 1 Alternation ranking 6 Graphic rating scale 2 Paired comparison 7 Behaviorally anchored rating scales (BARS) 3 Forced distribution 8 MBO 4 Critical incident 9 Computerized and Webbased methods 5 Narrative forms 10 Merged methods .

Scale for Alternate Ranking of Appraisee .

add up the number of +’s in each column to get the highest ranked employee.means “worse than.” .” For each chart. .Ranking Employees by the Paired Comparison Method Note: + means “better than.

FORCED DISTRIBUTION ON A BELL-SHAPED CURVE .

Examples of Critical Incidents for Assistant Plant Manager Continuing Duties Targets Critical Incidents Schedule production for plant 90% utilization of personnel and machinery in plant. orders delivered on time Instituted new production scheduling system. over-ordered parts “A” and “B” by 20%. decreased late orders by 10% last month. increased machine utilization in plant by 20% last month Supervise procurement of raw materials and on inventory control Minimize inventory costs while keeping adequate supplies on hand Let inventory storage costs rise 15% last month. prevented a machine breakdown by discovering faulty part . under-ordered part “C” by 30% Supervise machinery maintenance No shutdowns due to faulty machinery Instituted new preventative maintenance system for plant.

NARRATIVE FORMS • Final appraisals are frequently written in a narrative form • Supervisor rates employee by describing the behaviour related to each factor .

Graphic Rating Form .

but the tool has several advantages. . • Its proponents say it provides better.BEHAVIORALLY ANCHORED RATING SCALE (BARS) • BARS is an appraisal tool that anchors a numerical rating scale with specific examples of good or poor performance. • It takes more time to develop a BARS. more equitable appraisals than do the other appraisal tools.

Example of BARS for Dimension Salesmanship Skills .

MANAGEMENT BY OBJECTIVES MBO refers to a organizational 6 step goal setting and appraisal program Set the organization’s goals Set the departmental goals Discuss developmental goals Define expected results Performance reviews Provide feedback .

DEFINING THE EMPLOYEE’S GOALS AND WORK STANDARDS Guidelines for Effective Goal Setting Set SMART goals Assign specific goals Assign measurable goals Assign challenging/ doable goals Encourage participation .

Appraisal Form for Assessing Both Competencies and Specific Objectives .

Appraisal Form for Assessing Both Competencies and Specific Objectives (cont’d) .

CHOOSING THE RIGHT APPRAISAL TOOL Criteria for Choosing an Appraisal Tool Accessibility Ease-of-use Employee acceptance Accuracy .

ERRORS IN PERFORMANCE MEASUREMENT RATER ERROR PRACTICAL IMPACT Varying standards Similar perf is rated differently Primacy and Recency Error Timing of information affects rating Leniency/Strictness/ Central Tendency Everyone is rated the same Rater bias Rater prejudices affect rating Halo / Horns Generalisation is made from only one trait Contrast error Comparison is made to other people not standards Similar-to-me Error Rater compares employee to self Sampling error Available information is insufficient or inaccurate .

THE APPRAISAL INTERVIEW Satisfactory—Promotable Types of Appraisal Interviews Satisfactory—Not Promotable Unsatisfactory—Correctable Unsatisfactory— Uncorrectable .

PERFORMANCE FEEDBACK Components of a Feedback System Data on Actions Data Evaluation Action Based on Evaluation .

AppraisalCoaching Worksheet .